Conservation Finance
What is Conservation Finance?
Conservation Finance is the practice of raising and managing, and deploying capital to support land, water, and resource conservation.
The USDA Forest Service Conservation Finance Program supports the development of innovative financing models that leverage Forest Service-appropriations and other public funding by engaging private capital to increase the pace and scale of restoration. Through these models, the Forest Service is also able to leverage critical partnerships by highlighting and valuing the attractive resource and service streams that originate from National Forests for potential investors and donors through aligned environmental, social, and financial outcomes.
The Pacific Southwest Region now has upwards of 20 Conservation Finance (CF) projects at various stages of development integrating these innovative financing models in 15 of the 18 national forests. As with most of the Forest Service programs, the Pacific Southwest Region CF program is made successful through partnerships. The Regional CF Team actively works in partnership with more than 65 partners across the 20 projects.
The key CF program partners, (Blue Forest, Quantified Ventures, Conservation Investment Management, National Forest Foundation and World Resources Institute) and their engagement are funded through the Washington Office National Partnership Office Conservation Finance annual budget. Each of the key partners has a Master Challenge Cost Share Agreement with the Forest Service, with the opportunity to develop Supplemental Project Agreements (SPA) at the Regional Level for additional engagement. The CF project developers have projects divided into 3 categories of development; Explore, Design, and Implement. The CF program also gets funding for project engagement through the Innovative Finance for National Forest (IFNF) grant program that is authorized in partnership by the Forest Service and the U.S. Endowment for Communities and Environment. The IFNF grant program supports the development and implementation of innovative finance models that leverage private and public capital other than Forest Service (USFS) annual appropriations to enhance the resilience of the National Forest System (NFS) and deliver commensurate returns to stakeholders.
There are 6 key components that make a project ripe for engaging in CF:
- There is a minimum of a $3 million funding gap for the project.
- The planning (NEPA) is near complete and expects a decision memo within 1 year.
- The project has social, ecological, and financial outcomes that are expected from the proposed treatments.
- The landscape has potential beneficiaries with the willingness and ability to contribute financially to the effort.
- The local USFS and partner leadership approve of engaging in CF tools.
- There is sufficient data availability to predict and monitor the treatments and associated benefits..
Conservation Finance Highlights and Stories
The Pacific Southwest Region Conservation Finance (CF) Team engages in accomplishments reporting at the end of every fiscal year to share a summary of the work done throughout the region and amount of funding leveraged by the projects participating in CF. Below are the reports from Fiscal Years 2023 and 2024.
The Regional CF Team also supports communications about the ongoing work of the program through story telling of efforts.
Map of Projects
Where the Pacific Southwest Region's Conservation Finance Program Is Now
In 2018, the Forest Service signed an agreement with Blue Forest Conservation documenting their shared commitment to landscape-scale restoration and launched the Yuba I Project in partnership with the Tahoe National Forest. This was the first time a Conservation Finance tool, the Forest Resilience Bond (FRB), was used within the Forest Service. It provided $4 million in private capital from four investors to finance ecological restoration treatments across 15,000 acres of national forest. The Yuba I FRB was completed in December 2023.
In 2020, the 2nd FRB was launched as Yuba II, at $12.5M, to leverage ultimately $25M of service work to include thinning and prescribed burns on roughly 48,000 acres. This time the FRB was scaled to more than 2X the previous amount and included anchor beneficiary, Yuba Water Agency, providing more than 4X its previous contribution to Yuba I.
The 3rd FRB in R5 was launched in January 2024 with the Upper Molulemne River Watershed Authority (UMWRA), a Joint Powers Authority, on the Eldorado NF for Forest Projects Plan Phase 1 at $12.5M and has increased to $16.7M! This effort is planned for expansion with a Phase 2 expected on the Stanislaus NF in 2025. To read more about this FRB, view the story on Blue Forest’s webpage!
The 4th round of the Innovative Finance for National Forests (IFNF) grant program awarded the Pacific Southwest Region with 2 of 10 IFNF awards totaling $450K out of approximately $2.3M in available funds. These grants will support development of finance models that leverage private sector capital to support resilience of the National Forest System and surrounding lands. The IFNF website has more detailed descriptions of the IFNF program and awarded projects.
BF 2023 FRB Impact Report
We are working with several Conservation Finance Partners:
Blue Forest (BF)
Blue Forest is a conservation finance non-profit founded in 2015 that advances ecosystem restoration through scientific research, financial innovation, and collaborative partnerships. Since 2018, Blue Forest has managed investor capital through its flagship financial product, the Forest Resilience Bond (FRB), which deploys private capital to finance forest restoration projects to reduce the risk of catastrophic wildfire. Blue Forest has been involved in the scoping and implementation of projects in R5 since 2018, and continues to grow their reach across the Western U.S., bolstering the longstanding support they continue to provide our National Forests. While Blue Forest supports all varieties of restoration projects, they specialize in forest restoration and watershed health.
- Blue Forest’s Impact Reports track the environmental, economic, and social impacts to local ecosystems and communities, including the Yuba I, Yuba II , and Upper Mokelumne I FRBs, the FRBs underway in the Pacific Southwest Region.
- Watch this Video on the Forest Resilience Bond, made in partnership with the Forest Service and World Resources Institute.
- Watch California’s Watershed Healing, a PBS documentary about the FRB, North Yuba Forest Partnership, and collective efforts to restore and protect the Tahoe National Forest.
Quantified Ventures (QV)
Quantified Ventures is a certified B-Corporation and a woman-owned business that designs and structures innovative financing solutions to accelerate environmental, social, and economic outcomes. In partnership with the U.S. Forest Service, Quantified Ventures applies outcomes-based financing approaches to support outdoor recreation infrastructure, restoration, and conservation initiatives.
Notable Pacific Southwest Region Projects:
- Inyo National Forest & Mammoth Lakes Trails and Public Access (MLTPA): Supported the development of a business and financing plan to modernize campgrounds and improve visitor experiences.
- Save the Redwoods League – Alder Creek (Inyo National Forest, CA): Assisting in structuring financing to support recreation infrastructure improvements before the transfer of the property to the U.S. Forest Service, ensuring long-term public access and ecological stewardship.
- Conservation Finance Training: Provide expertise in financing strategies to Forest Service staff and partners, equipping them with tools to leverage external investment for priority projects. See here for an overview of their approach.
For more information on Quantified Ventures and its work in outdoor recreation and conservation finance, visit Quantified Ventures' website.
Conservation Investment Management (CIM)
Conservation Investment Management transforms environmental challenges into business opportunities through innovative conservation finance solutions. We combine startup methodologies with scientific rigor to develop sustainable business models that create value for all stakeholders. Our partnership with the Forest Service focuses on designing and implementing market-based solutions that:
- Create innovative public-private partnerships that leverage private capital for forest health
- Develop business models that address critical challenges like wildfire resilience and ecosystem restoration
- Generate new revenue streams from public lands while enhancing conservation outcomes
Our work with the Pacific Southwest Region includes:
- Forest WRX Alliance in Humboldt County, CA - Development of supply chain infrastructure and workforce capacity for biomass utilization from fuel reduction activities. https://www.wrxalliance.org
- Southern California Ignition Reduction Program, a wildfire mitigation efforts around Los Angeles. CIM is engaging the private sector through public-private partnerships to increase resilience and protect communities.
- Exploring opportunities to increase the supply of workforce housing by leveraging existing administrative sites on National Forest Land, addressing a critical need for Forest Service employees.
Contacts
Pacific Southwest RO Conservation Finance Coordinator: Madison Kirshner
Madison Kirshner (Pacific Southwest RO Conservation Finance Coordinator), Jason Collier (SoCal Zone), Stephaney Cox (North Zone), Jim Dipasquale (Pacific Southwest RO SPF), Jeff Heys (SoCal Zone), Jim Junette (So Sierra Zone), Kat Powelson (Central Sierra Zone), Monique Rea (North Zone), Joseph Rodarme (North Zone), Daniel Tune (So Sierra Zone), Tanya Torst (North Zone)
Pacific Southwest CF Cadre meets once a month to share information and discuss educational opportunities that will enhance greater region-wide understanding of the conservation finance program and tools.